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Jewellers celebrate decline in gold prices

23 September 2020

 

In a boost to jewellery sales ahead of the festive season, gold prices declined sharply by Rs 1,000 per 10g over the past two days. The price of the yellow metal stood at Rs 52,200 per 10g, against Rs 53,200 on Saturday. Jewellers believe a dip in prices will bring customers back to the market. Jigar Soni, vice president, Jewellers’ Association of Ahmedabad (JAA), said, “After the Shraddh period ended, we have already seen some movement of customers for small ticket size purchases. People have accepted that prices may not fall further below the Rs 50,000-mark and are making purchases. Sentiment is still weak, but we expect that if prices remain stable at this level, it will fuel gold jewellery purchases.”

 

“People are keeping tabs on prices and inquiries for jewellery have gone up over the past few days. The pent-up demand will now open up for jewellery during the festive season because several functions that were to be held in May were deferred till the end of the year,” said Manoj Soni, an Ahmedabad-based jeweller.

 

Jewellers say that at least 70% of purchases continue to be made by exchanging old gold whereas only 30% of customers are making fresh purchases. The ticket size of purchases has also gone down drastically. The sharp drop in gold prices is attributed to the appreciation of the rupee against the US dollar. “International gold prices fell below the $1,900-mark per ounce late on Monday and were at $1,911 on Tuesday. The increase was triggered by a massive fall in global equity markets and a fresh fears of a second lockdown in Europe. However, in line with the appreciation of the Indian rupee, gold prices continued to fall here,” said Haresh Acharya, director, India Bullion and Jewellers’ Association (IBJA). Industry experts say that demand for bullion has revived and investors who had sold gold to book profits are beginning to re-enter the market with investments.

 

Source: https://timesofindia.indiatimes.com/city/a